U.S.-Canadian Tariff War Will Cripple the Oregon Wine Industry
The retaliatory 25% Canadian tariff on billions of dollars of American goods is a crippling blow to the Oregon wine industry.
Howard Rossbach, owner of three Oregon wine brands with Canada as his biggest market, says the tariff war between the U.S. and Canada will ‘clobber’ his business.
Oregon Wines Account for 46% of Canadian Imports
Canada imports 46% of Oregon-produced wines. In 2023, according to the Oregon Vineyard and Winery Census, the state exported 72,641 cases to Canada.
The tariff war therefore leaves Oregon wineries reeling from the aftershock, with many facing a bleak future.
As Megan O’Neill, a senior associate at Farris LLP in Vancouver, British Columbia, explains, the 25% tariff is merely the ‘tip of the iceberg.’ Apart from the 25% increase at the point of entry, the total tax-on-tax amounts to about 35 to 40% in the cost of wines from Oregon, California, and other U.S. wine growing areas.
How many wineries will survive this latest blow remains to be seen. The resilience of many is expected to be at an all-time low after surviving the pandemic, labor shortages, wildfires, flattening sales, and killer frosts.
Eighty Percent of Two Oregon Wine Brands are Exported to Canada
Howard Rossbach, owner of the three Oregon brands, said that 80% of his Citation and Centerstone wines were exported and sold coast-to-coast in Canada, his biggest export market. Rossbach said he sells 1,500 cases of the two wine brands to Ontario alone.
A double blow to the wine industry is that apart from the tariff hike, several Canadian provinces have banned all wines from the U.S.
The 25% tariff is described as a ‘massive’ increase by Dai Crisp, co-owner of Lumos Wine Co. in Philomath. She thought it unlikely that anyone would buy Oregon wines at the new exorbitant prices because, said Crisp, she would not.
John Grochau, co-owner of GC Wines in Portland, said his partners were in Quebec, a seaport city where they could easily replace Oregon wines with imports from France, Spain, and Italy.
The president and CEO of the Wine Institute, Robert P. Koch said that Canada is the most important export market for America at $1.1 billion in retail sales annually.
Boycotting American products is adding another layer to the woes of Oregon wineries and goes ‘hand-in-hand’ with the Buy Canadian sentiment sweeping through the U.S.’ northern neighbor, said Charlie Skuba of the Georgetown University’s McDonough School of Business.
President Donald Trump has put his 25% tariff hikes on Canadian imports on temporary hold until 2 April.